On October 7, local time, the Palestinian Islamic resistance movement Hamas announced military action against Israel, and Israel declared a "state of war."

As the new round of Palestinian-Israeli conflict continues to escalate, its derivative impact on the global economy is gradually emerging - international oil prices have fluctuated violently, the price of safe-haven gold has risen, the Middle East stock market has plummeted, and U.S. military and energy stocks have surged. Reuters pointed out that this conflict has brought new uncertainty to global stability that has been affected by the escalation of the Ukraine crisis, undermined market confidence, and hindered global efforts to curb inflation.

From a perspective that is not paid attention to by the mainstream, Israeli encryption companies have also suffered many adverse effects in this conflict.

Israel’s Cryptozoology in Conflict

After the large-scale conflict broke out between Palestine and Israel, many Web3 projects headquartered in Israel attracted industry attention.

On October 11, Alon Muroch, founder of the Ethereum staking infrastructure SSV Network, stated on his social platform that he had been drafted into the army by Israel, saying that the actual situation was much worse than described . X tweeted that we are turning the situation around, but the process will be neither short nor beautiful. Alon Muroch's social platform profile location shows that he lives in Israel.

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Ben Samocha, CEO of Israeli crypto company CryptoJungle, was on his way to attend the funeral of his student who was attacked along with 260 other young people at a nearby music festival on Tuesday.

Samocha is one of the few people working in the Israeli cryptocurrency industry suddenly scrambling to deal with a crisis the likes of which they have never seen before. Samocha helped organize an aid campaign to raise cryptocurrency donations while dealing with the fallout from the Israeli-Palestinian conflict and trying to stay optimistic.

Samocha said: “I believe that we as a country, as a people, as a company will be able to get back on our feet and get back to normal. Cryptocurrency is here to stay, blockchain is here to stay, we need education, we need content, and we will be here Provide this content.”

Several cryptocurrency executives and developers in the country told CoinDesk that they have not experienced significant business disruption, and many of them are working remotely. They were primarily busy dealing with the personal impact of the conflict, such as the stress and annoyance of empty supermarket shelves, and dealing with security scares.

“We are very aware that even during these unimaginable times, life needs to go on,” said Guy Itzhaki, CEO and co-founder of Fhenix, an upcoming blockchain network that will introduce synchronization in smart contracts. Stateful encryption technology.

In the wake of the conflict, the cryptocurrency company's day-to-day operations and employees have more or less come to a standstill.

Out of this conflict was born the "Crypto Aid Israel" campaign, which is a campaign led by a number of Israeli cryptocurrency companies that accepts cryptocurrency donations to help those affected by the war. People who are affected or displaced.

Samocha helped organize the campaign, which along with the company's COO Tal Mor, raised approximately $85,000 in 24 hours since its launch on the 9th. Samocha said his employees at CryptoJungle were involved in the campaign.

More cryptocurrency companies are also organizing volunteer activities, such as preparing food or clothing for those in need, and numerous companies are working together as a team to support those most affected by violence.

Asaf Nadler, co-founder of Addressable, an Israeli Web3 marketing company, said that half of his employees are volunteering to help, either donating blood or helping carry clothes or food. As a company, people are deeply involved.

Many cryptocurrency executives said employees have been drafted to serve in the military, and companies are allowing employees time to volunteer or support relatives affected by violence. For now, most cryptocurrency companies are keeping an open mind but are also making plans to adapt to the impact of employee turnover.

Tal Shalom, a partner at Israeli Web3 investment firm Collider Ventures, said that no one now expects employees to be 100% committed to work. Companies focusing on Web3 are now preparing for different scenarios, such as fully remote working, or working in different locations to prevent the impact of being unable to resume offline work for an extended period of time.

For those at war, work was a temporary escape from the harsh reality.

A cryptocurrency analyst working in the West Bank said he was working from home now that schools have been closed and was not affected much other than the distraction of having children around him. Supermarkets are mostly sold out of bread, eggs, milk and produce, apparently due to supply chain disruptions and hoarding.

Israeli officials have always had a relatively open attitude towards crypto companies, but according to the Financial Times, Israel has ordered the freezing of cryptocurrency accounts to prevent the flow of funds from Hamas.

An encryption pole that cannot be ignored

Before the conflict, the Israeli Web3 ecosystem was growing rapidly. Israel's pioneering combination of risk-taking entrepreneurs, academic luminaries, and intelligence experts has placed Israel at the forefront of the world's technological advancements.

Israel has always been a hotspot for technological innovation, especially in areas such as blockchain technology, network security, cryptography, etc. Israeli universities and research institutions have trained many outstanding computer scientists and cryptographers, who have made important achievements in the research and development of encryption technology.

Israel is home to a large number of successful startups and ranks seventh in the world for the number of unicorn companies, despite having only 0.1% of the global population. These companies provide innovative solutions in areas such as cryptocurrency, smart contracts, digital identity verification, etc., attracting a large number of international investments and partners. For example, well-known experts such as Eli Ben Sasson, Shaffi Goldwasser, Yehuda Lindell, Aviv Zohar, and Eran Tromer. The MPC and ZKP they conceived and proposed are important technologies in the development of blockchain.

Israel is an ideal hotbed for blockchain and cryptocurrency innovation. Israel is known as the "Startup Nation" with a thriving venture capital environment that provides funding and support to crypto and blockchain startups. Additionally, Israel has various incubators and startup accelerators that help crypto projects grow. This has also laid the foundation for disruptive innovations in various industries, and Israel also hopes to become a global leader in the fields of blockchain, Bitcoin and cryptocurrency.

Israel Web3 ecological map source/collider

Israel's Web3 project covers many fields such as Layer2, DeFi, Layer1, NFT and games. Starkware, one of the more successful unicorn companies, has a valuation of US$8 billion. There are also many startups that have been successfully acquired by giants. For example, Unbound Security, which provides custody services and cryptography technology, was acquired by Coinbase for more than $150 million, and encryption security company Curv was acquired by PayPal for about $200 million.

In terms of corporate quality and technological influence, Israel is destined to be an important link in the global encryption ecological chain that cannot be ignored.

Conclusion

The conflict may cause some international investors to be wary of Israeli startups and crypto projects, fearing that geopolitical instability may pose risks to their investments, which may cause some disruption to some projects in the short term, but Israeli crypto The ecosystem currently seems to have not suffered a fatal blow, and relevant local company projects are also actively coping with the impact of the conflict and remaining optimistic.

From the Russia-Ukraine conflict to the current Palestinian-Israeli conflict, it is difficult for the decentralized encryption world not to be affected by geopolitics. In the current conflict, we can also see news such as Binance banning related accounts, claiming to be decentralized. Cryptocurrency can also be influenced by power. This is a complex issue, that is, how to respect the law and the legitimate requirements of national security while protecting individual rights and freedoms. There is currently no solution to this issue.

May the world be at peace and may crypto prosper.